Market Recap: RISI Crow's Construction Materials Cost Index
A price index of lumber and panels used in actual construction for Sep. 1, 2017.
Western: regional species perimeter foundation
Southern: regional species slab construction
Crow's Market Recap: A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow's Weekly Market Report.
Lumber
Follow through from last week’s uptick in sales placed upward pressure on SPF mill prices in both the East and West. Buyers waiting for prices to decline in response to the CVD-gap period were forced back into the market to cover needs. In essence, the market performed exactly how buyers hoped it would not.
A threat of diminished production entered the Southern Pine lumber market early, prompting buyers to participate more eagerly early. Record rainfall from Hurricane Harvey and subsequent reduction in large-log availability heightened wide width demand.
The resiliency of Coastal species pricing surprised traders. Producers both heard of and experienced repercussions from Oregon wildfires, which only firmed their resolve to maintain price levels.
Inland lumber producers report that Hem-Fir was on firmer footing This renewed demand in Hem-Fir, combined with a continuing strong demand in Fir-Larch, created a very solid week of activity.
The level of weakness across stud markets abated as buyers purchased greater volumes. Availability of several stud items grew tighter as the week progressed, prompting producers to firm quotes.
Demand for Radiata Pine Mldg&Btr has not been strong. Producers, however, have maintained a rigorous grip on prices and have not wavered.
Ponderosa Pine availability appears ample in both Mldg&Btr and Shop grades. Even so, reports indicate stability at current price levels for most Ponderosa industrial items. Ponderosa Pine 4/4 boards have been ground up in the rumor mill over the last couple of weeks. This pre-holiday week, however, shows Selects to be very stable. The Common boards have been subject to offers and counters, but most producers have promoted “some upward moves.”
Western Red Cedar buyers frequently inquired about how commerce’s decision to delay the final CVD determination and extend the duty-free gap period might influence prices. While buyers looked for lower prices, producers noted that supplies of most items were tight enough to maintain current price levels.
Panels
Between horrendous, unprecedented flooding in Texas and ongoing record forest fires in BC, OSB market players are puzzling over where markets may go in the near term. Production and transportation in the South are compromised. Pricing was a mixed bag.
Southern Pine plywood prices moved strongly higher in response to elevated demand levels. Last week’s pre-Hurricane Harvey buying created momentum in the marketplace, prompting buyers to participate as close to a price floor as possible. Wholesaler participation was a large component to a firmer market, followed by distributors and dealers shoring up scant inventories.
Deep discounts present in the Western Fir plywood market in past weeks expired. Buyers took note of the marginal strengthening and stepped in to cover needs while prices firmed.
Activity was mostly subdued in the Canadian plywood market this week at all levels, though a few contacts reported busy warehouse sales. Buyers are increasingly uncertain that current record-high price levels will hold and are buying hand-to-mouth accordingly.
Particleboard producers reported little change in the week’s sales or shipments. Customers remained busy in some sectors while others lagged.
Slower MDF sales forced some cuts in production in the West.
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